Alaska Conservator Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain an Alaska Conservator bond.
At a Glance:
- Average Cost: Calculated based on a tiered structure
- Bond Amount: Determined on a case-by-case basis (more on this later)
- Who Needs It: Certain conservators that have decision-making authority over the assets of a ward residing in Alaska
- Purpose: To ensure that wards receive compensation for financial harm if the conservator mishandles their assets
- Who Regulates Conservator Bonds in Alaska: The clerk of the superior court with jurisdiction over where the ward resides
Alaska Statute 13.26.401 requires all persons seeking conservatorship over a ward to be appointed by the clerk of a superior court before assuming their fiduciary duties. The Alaska legislature enacted the appointment requirement to ensure that conservators properly advocate for a ward’s best interests. To provide financial security for the enforcement of this requirement, conservators that have decision-making power over a ward’s assets must purchase and maintain a probate surety bond before becoming appointed as a fiduciary.
What is the Purpose of the Alaska Conservator Bond?
Alaska requires some conservators to purchase a surety bond as a prerequisite to being appointed as a fiduciary over a ward’s assets. The bond ensures that wards will receive compensation for financial harm if the conservator fails to abide by the regulations outlined in Alaska Statute 13.26.470. Specifically, the bond protects the ward if the conservator fails to adhere to all court orders or mismanages the ward’s finances. In short, the bond is a type of insurance that protects the ward if the conservator does not fulfill their fiduciary duties.
How Can an Insurance Agent Obtain an Alaska Conservator Surety Bond?
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How is the Bond Amount Determined?
Alaska Statute 13.26.470 dictates that the bond amount must be equal to the aggregate value of the estate’s property under the conservator’s control plus the estimated income to be generated by the estate over the next year. The bond amount may be reduced by the value of any securities deposited that cannot be withdrawn without a court order or any land that the conservator can not sell without authorization from the court. Fiduciaries that do not wish to purchase a bond may choose to submit a pledge of securities or mortgage of land to the court instead.
What are the Underwriting Requirements for the Alaska Conservator Bond?
Most surety companies will examine the following factors when determining eligibility for the Alaska Conservator bond:
- Conservator’s credit history
- Whether or not the estate has an attorney
- Whether or not the conservator is a family member
- The conservator’s occupation
- Whether or not the conservator is replacing a prior fiduciary
- If the conservator has ever committed a felony
- Whether or not there is any ongoing business in the estate
- If the bond is being required by a creditor
- If the bond amount is greater than or equal to the estate’s value
How Much Does the Alaska Conservator Bond Cost?
Surety companies typically determine the premium rate for conservator bonds based on a tiered structure. As a result, larger bond amounts will be charged a lower premium rate than smaller bonds.
The following table illustrates the pricing structure for the Alaska Conservator bond:
$1,500,000 Conservator Bond Cost
|Bond Amount||Premium Rate||Total Bond Cost|
|Total cost of $4,715|
Who is Required to Purchase the Bond?
Alaska requires conservators with decision-making authority over a ward’s assets to purchase a surety bond as a prerequisite to becoming a court-appointed fiduciary. Alaska Statute 13.26.470 grants the superior court the authority to determine if a bond is needed. The court will typically require a bond when there are a substantial amount of assets that need to be protected.
To paraphrase Alaska Statute 13.06.050, a conservator is defined as a person appointed by the clerk of a superior court to make decisions over a ward’s finances that represent the ward’s best interests. Additionally, “ward” is defined as either a minor or adult deemed incapable of making sound decisions concerning their person and/or property.
The superior court may also require guardians to purchase a surety bond as a prerequisite to being appointed as a fiduciary. Guardians and conservators have similar duties, however a conservator only has the power to manage the financial affairs of a ward while a guardian has the power to manage the financial affairs and personal decisions of a ward.
How do Alaska Conservators Become Appointed as Fiduciaries?
Conservators in Alaska must navigate several steps to become appointed as fiduciaries. Below are the general guidelines, but applicants should refer to the Alaska Court System’s conservatorship page for details on the process.
Step 1 – Hire an Attorney
Although not explicitly required, it is highly recommended that conservators hire an attorney to assist with the conservatorship process.
Step 2 – File a Petition for Appointment
Persons seeking appointment as a conservator over a ward must file a petition for appointment with the clerk of the superior court with jurisdiction over where the ward is currently residing. Conservators must ensure they complete the form accurately and have it notarized. Family members or friends of the ward are most commonly appointed as the conservator. However, when a family or friend is not able, the court can appoint a private professional conservator or public guardian.
Step 3 – Attend a Hearing
Conservators must attend a hearing conducted by the clerk of the superior court and present evidence as to why the minor or incompetent adult is in need of a conservatorship. The clerk will examine the evidence presented by the conservator as well as that presented by the minor/adult being evaluated (if any) and make a determination as to whether or not conservatorship is necessary.
Step 4 – Accept the Appointment
Once the court issues a Conservatorship Order, the conservator must file an acceptance of appointment. Additionally, conservators must complete one hour of mandatory education within 30 days of being appointed. Conservators can complete the required training through video and reading materials available at their local court and must submit an affirmation form once completed.
Step 5 – Purchase a Surety Bond
Unless otherwise exempt, conservators with decision-making authority over a ward’s finances must purchase and maintain a surety bond (limits outlined above).
How do Alaska Conservators File Their Bonds?
Conservators should submit their completed bond forms, including the power of attorney, to the clerk of the superior court with jurisdiction over where the ward resides.
The surety bond requires signatures from both the surety company that issues the bond and the applicant. The surety company should include the following information on the bond form:
- Legal name of the entity/individual(s) buying the bond
- Legal name of the ward
- The judicial district of the court
- Bond amount
- Date the bond is signed
What can Alaska Conservators do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, conservators in Alaska must ensure that they:
- Perform all of their fiduciary duties
- Obey all court orders
- Do not mismanage the ward’s assets